“If anyone in business is under 40, they haven’t been through this stuff. When you’re an old guy, you have a model of how to get through it.”
That “stuff” would be one of the worst economies since the Great Depression, led by the utter implosion of the housing market. And the old guy? At 57, Wayne Drinkward isn’t really that old, although his company is 87, but he makes the point. Hoffman Construction has been through bad times before and survived, and this down cycle, which counts the construction industry among its biggest victims, will be no different.
On a rainy early winter day, as the freefall began in earnest, Drinkward seems nonplussed by the question of how the region’s biggest construction firm and one of Oregon’s largest private companies (around $1.2 billion in revenue for 2008) would weather the storm.
“In good times or bad, the way is about the same,” he says. “We develop from within; we take on only what we can do; in good times, we don’t add a lot of people at the top; and when there is less construction, we are loyal to the people we have.”
Drinkward says there hasn’t been a large layoff since the 1980s when the company had to cut itself in half to survive. Hoffman came back from that brink in the early 1990s, when it grew in three years from $150 million to $1 billion in revenue, spurred by the company’s relationship with a large microprocessor manufacturer (they won’t say who) that hired Hoffman to build semiconductor manufacturing facilities around the country.
Stability also comes from Hoffman’s depth and breadth. It builds a wide range of projects nationally and internationally, including schools, condos, prisons and hospitals. Some of its signature buildings include the Fox Tower in Portland (also home to Hoffman’s headquarters), the Portland Building, the Seattle Library, and that city’s Experience Music Project. Drinkward says there are large projects in the pipeline that are fully funded and will carry them through the near future. They include the University of Oregon’s stadium, ZGF headquarters in downtown Portland, two large airport projects, Legacy Pediatric Tower, and Oregon State Hospital.
What gets built inside the employee-owned company is just as important to Drinkward. The average tenure of its 500 employees is 15 years and many have 30 years in. It’s also a company with great personal history: He has two sons and a brother working for Hoffman and he took over the top spot from his father, Cecil, in 1992. His father, now 80, still has an office next to his.
“When my father ran the company, it was CEO to CEO. Now it’s done between the teams,” says Drinkward. “That’s very powerful. They own it.”
By design, there is no mission statement, no posters on the wall, no huge HR operation. “We don’t have a book on anything here. We just say, ‘You’re smart. Figure it out.’”
Despite the downturn, he says the company is expected to still post more than $1 billion in revenue for this year, even though he knows “we’re going into a period with more challenges.” Drinkward predicts there is at least a five-year slowdown ahead.
“There’s a gap [in work] coming regardless of whether they fix the credit issue. It’s hit the architecture community first. Projects are stalling. Both private and public works are stuck. It’s like a glacier has slid across the river and the money has stopped flowing,” says Drinkward. “But we’re still fishing.”
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